MIRAMAR, Fla., Jan. 4 (UPI) -- For the lack of 2 cents in a payment, a couple in Florida said their COBRA insurance coverage was canceled while the wife was pregnant.
Stan Rosen of Miramar, Fla., was eligible under provisions and amendments of the Consolidated Omnibus Budget Reconciliation Act for his employer-provided insurance to continue for 18 months after he was laid off, so long as he paid the entire $334.99 monthly premium, The Miami Herald reported Monday.
But insurance companies are finding mostly older workers with health issues maintain their insurance, increasing their liabilities and many find COBRA laws so convoluted, they contract specialized firms to handle COBRA policies, the report said.
COBRA is "a major pain in the butt. There's a ton of liability," said Gran LeCompte, an executive with MDW Insurance.
The Herald said "about 100 phone calls" from Stan Rosen and his father and an inquiry from the newspaper caused one of the largest COBRA specialization firms, Ceridian, to finally reverse its decision and reinstate Rosen's policy after his policy was canceled when he paid $334.97 for the November bill -- a mistake he corrected when he got the next bill.
Ceridian's stance while rejecting the policy was that it was following the letter of the law.
But a consumer watchdog group warned the COBRA law "has serious limitations."
"It's a very important right that's not meaningful in reality," said Ron Pollack, head of Families USA in Washington.
